In May, the Hsinchu-based panel maker unveiled its plan to form a US$700 million solar cell venture with SunPower Corp of Malaysia, completing the last piece of AUO’s involvement in the solar industry supply chain, after it invested in solar wafer manufacturing and solar system installation businesses.

The AUO-SunPower joint venture has produced 5 megawatts of solar cells since October, the companies said in a joint statement and the conversion rate reached 22.5 percent.

AUO expects to complete the construction of 18 production lines at the new solar cell plant by 2013. No information about the amount of the investment was disclosed.

“Malaysia’s investment in the AUO-SunPower joint venture — an excellent talent pool and a positive business investment climate — has given us the opportunity to significantly expand solar cell production that will meet the demand for solar worldwide, which has grown nearly eight-fold over the past four years. We appreciate our partnership with the Malaysian government,” SunPower chief executive Tom Werner said in a statement.

However, supply is expected to grow beyond demand by between 20 gigawatts and 25 gigawatts, increasing concern of a supply glut, TrendForce said in a report released on Tuesday.

Separately, AUO said that as of the end of last month, it had 7,400 patents registered globally, which has given the company an upper hand in winning patent lawsuits. The company said that as of the end of last month, it had filed 15,000 patent applications.